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In his COS speech, Manpower Minister Tan See Leng also outlines details on a new S$400mn Enterprise Workforce Transformation Package to support businesses.
During his Committee of Supply (COS) speech on 6 March 2025 (Thursday), Minister for Manpower, Dr Tan See Leng highlighted several key initiatives aimed at enhancing Singapore's workforce landscape while ensuring businesses can access the talent they need.
These fall under three key priorities for the Ministry in the year ahead:
#1 Enabling businesses to transform,
#2 Empowering workers to build career health, and
#3 Fostering inclusive and safe workplaces.
This article will focus on the first area: Enabling businesses to transform.
Work pass updates: Enhancing access to skilled foreign talent
Talking about the foreign workforce, Minister Tan acknowledged that businesses have cited manpower constraints as a key challenge. At the same time, he noted Associate Professor Jamus Lim's sharing that there is ground scepticism over the need for foreign talent, adding: "That scepticism is natural – when we see a foreigner, we think, 'they are taking a job a Iocal could have had'.
"What is harder to see is that, without access to foreigners, the company and its jobs would not be in Singapore to begin with."
The Minister went on to share how government continues to carefully manage its work pass framework to ensure foreign workers complement the local workforce and contribute positively to Singapore's economy.
- Over the past decade, the number of EP and S Pass holders grew by 38,000, while resident PMETs increased by 382,000. One in three of the increase in resident PMETs came from non-PMETs upgrading to higher-skilled roles.
- Sectors such as financial services, professional services, and ICT saw an increase of 18,000 EP and S Pass holders, while resident PMETs grew by 172,000.
- As of 2024, there were three to six resident PMETs for every 1 EP or S Pass holder in key sectors.
- The labour force participation rate of Singapore citizens is high, and the unemployment rate remains low, among the lowest globally.
- In 2024, 3,000 ONE Passes were issued, attracting global talent that contributes economically and socially through mentoring and volunteering.
Moving forward, Minister Tan shared a series of updates pertaining to EP, S Pass, and Work Permit requirements in the recent years, as well as key changes to be noted in the upcoming months:
EP framework updates
The EP framework is continuously refined to ensure foreign talent complements the local workforce and supports Singapore’s productivity. The minimum qualifying salary for EP holders was increased from S$5,000 to S$5,600 starting 1 January 2025, in a bid to ensure EP holders are high-calibre professionals. To this point, Minister Tan said no further changes will be made this year.
Next, Minister Tan pointed out suggestions that Singapore level the salaries for local and foreign workers through a CPF escrow. Responding to this, he said: "This is unnecessary – when setting the qualifying salary, we already include CPF contributions in the local wage benchmarks. In salary terms, the playing field is fair."
He affirmed that while the take-home pay of an EP holder may be higher because they do not contribute to CPF, it does not mean locals are paid less, as their CPF contributions go towards housing and retirement needs.
Third sharing an update on how Singapore's EP framework incentivises businesses to develop a strong local core. This is where the COMPASS framework, introduced a year and a half ago, comes in. Since its introduction, companies have reduced reliance on foreign workers and created 4,000 new PMET jobs for locals.
S Pass updates
At the S Pass level, Minister Tan said the Ministry will continue to raise the quality of the workforce and safeguard employment opportunities for local associate professionals and technicians (APTs).
"We have benchmarked the minimum cost of hiring for S Pass holders to the top one-third of local APT wages. To ease the transition, we phased out the increase in the S Pass qualifying salary over three steps, in 2022, 2023 and 2025."
In light of businesses’ cost challenges, we have moderated the increase, Minister Tan announced that the increase has been moderated. From September 2025, the minimum qualifying salary will rise from S$3,150 to S$3,300, with higher increases for the financial services sector (from S$3,650 to S$3,800). These qualifying salaries will increase with age per the usual practice; and will apply to renewal applications expiring from 1 September 2026.
At the same time, the S Pass levy rate will be standardised at S$650. These adjustments help ensure S Pass holders complement the local workforce.
Work Permit updates
Finally, at the Work Permit level, the Minister shared that Work Permit numbers are now at an all-time high of 17% above pre-COVID levels, particularly in sectors such as construction, food services, and accommodation.
Other recommendations made by Members of Parliament (MPs) are also being adopted, including the removal of the 14-26 years maximum employment period for Work Permit holders, aligning their retirement age with locals at 63.
Additionally, the list of Non-Traditional Sources (NTS) countries will expand to include Laos, Cambodia, and Bhutan, while the Non-Traditional Sources Occupation List will be updated to include more non-PMET roles.
Last, the Manpower for Strategic Economic Priorities scheme will also be expanded to support companies by increasing support for them to send locals overseas for leadership exposure.
Minister Tan affirmed that the government is committed to enhancing the quality of the Work Permit workforce while acknowledging the challenges in automating and recruiting locals. Targeted flexibilities, such as in conservancy cleaning, are being provided. Citing what Second Minister for Home Affairs Josephine Teo mentioned, he said the Ministry is carefully augmenting the recruitment pool for critical roles like Emergency Medical Services and auxiliary police officers while ensuring a strong local workforce.
The government is also considering suggestions, such as those from MP Hazel Poa, to allocate more foreign workforce quotas to companies with inclusive employment practices, although it will carefully balance this with the goal of driving business transformation and encouraging local hiring. The Work Permit framework is under review to meet evolving workforce needs, with updates to be shared in the future.
Enterprise Workforce Transformation Package
To help businesses transform their workforce and stay competitive, the government is introducing a S$400mn Enterprise Workforce Transformation Package with three main features:
- SkillsFuture Workforce Development Grant: This combines various workforce development schemes into one application, supporting activities such as job redesign and training.
- Enhanced job redesign support: Funding for job redesign will increase to 70%, with the cap of S$30,000 also being raised.
- SkillsFuture Enterprise Credit (SFEC) Redesign: From 2026, companies will receive a fresh S$10,000 in credits to offset workforce transformation costs. Companies can use the credits to offset out-of-pocket expenses on relevant workforce transformation programmes.
NTUC Company Training Committee (CTC) Grant
The NTUC CTC Grant was enhanced in 2024 to support training tied to business transformation, with Minister Tan noting that the take-up has been encouraging.
As of December 2024, the CTC Grant has supported more than 400 transformation projects, benefitting more than 7,000 workers.
In light of this, following Prime Minister and Minister for Finance Lawrence Wong's Budget 2025 announcement, S$200mn will be set aside to scale up the grant, and to extend it to 2028.
HR transformation
A new Tripartite Workgroup on Human Capital Capability Development will be launched to raise HR standards and improve HR professionals' ability to contribute to business and workforce outcomes.
Minister Tan affirmed that the government is committed to enhancing the quality of the Work Permit workforce while acknowledging the challenges in automating and recruiting locals. Targeted flexibilities, such as in conservancy cleaning, are being provided. As Second Minister for Home Affairs Josephine Teo mentioned, the Ministry is carefully augmenting the recruitment pool for critical roles like Emergency Medical Services and auxiliary police officers while ensuring a strong local workforce.
The government is also considering suggestions, such as those from MP Hazel Poa, to allocate more foreign workforce quotas to companies with inclusive employment practices, although it will carefully balance this with the goal of driving business transformation and encouraging local hiring. The Work Permit framework is under review to meet evolving workforce needs, with updates to be shared in the future.
Quoting Singapore's founding Prime Minister Lee Kuan Yew, Minister Tan said: "If we do not attract, welcome and make talent feel comfortable in Singapore, we will not be a global city, and we will not count for much." This vision remains central to Singapore's workforce transformation efforts.
Read our other Committee of Supply coverage below:
- MOM Committee of Supply 2025: S Pass minimum qualifying salary to be increased from Sep 2025, and more work pass updates
- MOM Committee of Supply 2025: Minister Tan highlights 3 workforce priorities for the year ahead
Lead image / MOM
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